Provide an Appropriate Response

question 24

Multiple Choice

Provide an appropriate response.
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Definitions:

Free Entry

A market condition where there are no barriers to entering an industry or market, allowing any firm to compete without restrictive licenses, patents, or regulations.

Perfectly Competitive

A market structure characterized by many buyers and sellers, homogeneous products, and the absence of barriers to entry, leading to optimal price and output levels.

Excessively High Profits

Profits that significantly exceed the normal expected return, often seen as unreasonable or indicative of limited competition.

Perfectly Competitive Market

A market structure characterized by many buyers and sellers, homogenous products, and free entry and exit, leading to price determination purely by demand and supply.